Exhibit 23: Policy Rate Path Projections Low Expectations of a US Recession We expect the pace of monetary policy tightening to Recessions in the US have been triggered by accelerate but remain benign. Federal Reserve tightening of monetary policy; by Federal Funds Rate (%) economic imbalances such as the bursting of the 40) ———— 186 View dot-com and housing bubbles in 2000 and 2008, 3{ ——— ae _3,__ Tespectively; or by external shocks such as the Arab Median Federal Reserve Projection Pn oil embargo in 1973. The first two triggers are ‘ we*” 08 ~~ unlikely to occur in 2017, and the third, a shock, 25 oo is not something that we can typically anticipate. on |t we 20 However, we do think that China will be a 14 ee source of downside risk sometime over the next ° ce three years. 1.0 - Z at First, as we mentioned in last year’s Outlook, iN =a there have been five tightening cycles in the post- WWII period that have not triggered a recession. OO ota onctd Tents pect?) Four of those cycles occurred during the three netaas of Devernber 31,2016 longest recoveries, as shown in Exhibit 24. Those Nata: Far info atiatioral ouranses Ahly, TRBte Can ba An aSeurancathat the ToreeaSts wil cycles have been characterized by an early start Se meihestoent Strategy Group, Bloomberg, Goldman Sachs Global Investment Research, to the tightening cycle, a slow pace relative to Federal Reserve. historical averages (220 basis points per year for hhh nonrecessionary tightening and 330 basis points per year in recessionary cycles), low core inflation and rate hikes should the economy weaken, and will slack in the labor market. This cycle shares those pick up the pace later in 2017 or 2018 if the characteristics: the tightening cycle started in 2015, fiscal package under the Trump administration is the pace has been 25 basis points per year, the core bigger than we expect (see Section II, 2017 Global —_ personal consumption expenditures (PCE) index— Economic Outlook, for a more detailed discussio